rotex Benz CT-40 Total CT-40 Total 100 Required: 250 600 liters The quantities of chemicals purchased and used during the current production period are shown in the following schedule. A total of 200 batches of Gas Gain were manufactured during the current production period. Energy Products determines its cost and chemical usage variations at the end of each production period. Chemical Quantity Used Echol 38,000 liters Protex Benz 50 Mix variance Usage variance 0.425 0.150 0.300 Yield variance 42.50 37.50 Compute the total direct materials usage variance, and then break down this variance into its mix and yield components. Do not round intermediate computations and round final answers to the nearest cent. (CMA adapted) 15.00 $135.00 18,400 54,000 10,800 121,200 liters X Favorable Favorable Unfavorable

rotex Benz CT-40 Total CT-40 Total 100 Required: 250 600 liters The quantities of chemicals purchased and used during the current production period are shown in the following schedule. A total of 200 batches of Gas Gain were manufactured during the current production period. Energy Products determines its cost and chemical usage variations at the end of each production period. Chemical Quantity Used Echol 38,000 liters Protex Benz 50 Mix variance Usage variance 0.425 0.150 0.300 Yield variance 42.50 37.50 Compute the total direct materials usage variance, and then break down this variance into its mix and yield components. Do not round intermediate computations and round final answers to the nearest cent. (CMA adapted) 15.00 $135.00 18,400 54,000 10,800 121,200 liters X Favorable Favorable Unfavorable

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter9: Standard Costing: A Functional-based Control Approach

Section: Chapter Questions

Problem 17E: Chypre, Inc., produces a cologne mist using a solvent mix (water and pure alcohol) and aromatic...

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Standard Costing, Ethical Behavior, Usefulness of Costing Pat James, the purchasing agent for a local plant of the Oakden Electronics Division, was considering the possible purchase of a component from a new supplier. The component’s purchase price, $0.90 compared favorably with the standard price of $1.10. Given the quantity that would be purchased, Pat knew that the favorable price variance would help to offset an unfavorable variance for another component. By offsetting the unfavorable variance, his overall performance report would be impressive and good enough to help him qualify for the annual bonus. More importantly, a good performance rating this year would help him to secure a position at division headquarters at a significant salary increase. Purchase of the part, however, presented Pat with a dilemma. Consistent with his past behavior, Pat made inquiries regarding the reliability of the new supplier and the part’s quality. Reports were basically…
A company has set a new policy of acquiring materials from a second hand auction because it is cheaper than market price. Upon further investigations you have discovered that the materials from the auction are lower than the normal standard. How is the new policy likely to impact on the following variances: Material Usage: Choose... Labour Efficiency: Choose... Fixed overhead expenditure: Variable overhead efficiency: Previous page Choose... Choose... Next page
.Calculate the efficiency variance for variable setup overhead costs X Industries, Inc., produces air purifiers. X, Inc., produces the air purifiers in batches. To manufacture a batch of the purifiers, X, Inc., must set up the machines and assembly line tooling. Setup costs are batch-level costs because they are associated with batches rather than individual units of products. A separate Setup Department is responsible for setting up machines and tooling for different models of the air purifiers. Setup overhead costs consist of some costs that are variable and some costs that are fixed with respect to the number of setup-hours. The following information pertains to June 2008: Budget Actual Amounts Amounts 10,000 Units produced and sold Batch size (number of units per batch) Setup-hours per batch Variable overhead cost per setup-hour Total fixed setup overhead costs 9,000 400 375 6 5.5 $50 $52 $18,000 $17,750 $114 favorable $264 unfavorable $264 favorable $150 favorable $250 favorable O
Feel soft Beauty cosmetics manufacturing company produces two products, Sunscreen and Moisturizer creams. The company gives the following information. Products Standard Quantity (Units) Standard Price ($) Actual Quantity (Units) Actual Price ($) Sunscreen 40 50 50 50 Moisturizer 60 40 60 45 Required to Calculate the following Feel soft Beauty cosmetics co. Material Price variance Material cost variance Material usage variance Explain the following variances. Sales mix variance Sales volume variance Explain the term divisional performance and explain any two common measures of divisional performance.
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Energy Products Company produces a gasoline additive, Gas Gain. This product increases engine efficiency and improves gasoline mileage by creating a more complete burn in the combustion process. Careful controls are required during the production process to ensure that the proper mix of input chemicals is achieved and that evaporation is controlled. If the controls are not effective, there can be a loss of output and efficiency. The standard cost of producing a 500-liter batch of Gas Gain is $135.00. The standard direct materials mix and related standard cost of each chemical used in a 500-liter batch are as follows: Chemical Mix SP Standard Cost Echol 200 liters $0.200 $40.00 Protex 100 0.425 42.50 Benz 250 0.150 37.50 CT-40 50 0.300 15.00 Total 600 liters $135.00 The quantities of chemicals purchased and used during the current production period are shown in the following schedule. A total of 230…
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Refer to the information for Cinturon Corporation on the previous page. Required: 1. Break down the total variance for materials into a price variance and a usage variance using the columnar and formula approaches. 2. CONCEPTUAL CONNECTION Suppose the Boise plant manager investigates the materials variances and is told by the purchasing manager that a cheaper source of leather strips had been discovered and that this is the reason for the favorable materials price variance. Quite pleased, the purchasing manager suggests that the materials price standard be updated to reflect this new, less expensive source of leather strips. Should the plant manager update the materials price standard as suggested? Why or why not?
Q.Compute the direct materials price and efficiency variances.